The state of Tennessee has a provision that allows for the possession and use of items regulated under the National Firearms Act (NFA). This authority is granted in Title 39, Chapter 17 of the Tennessee Code Annotated. While Tennessee state law allows for the use and possession of these items, federal law requires that they be registered through the federal government. The registration process can take two months or more and requires a $200 tax stamp in most cases.
NFA trusts, sometimes simply called gun trusts, are an alternative to individual registration and ownership of NFA items. Under federal law, if an individual registers an NFA item in their own name then only that person can be in possession of the item. Registering as a trust, however, will offer more flexibility and the chance to prepare for future contingencies. This is because the trust itself, and not any particular individual, is the owner of the property, and anyone named in the trust can use the property.
A trust is essentially a legal instrument created so that a person or organization can hold property for a beneficiary. Tennessee law requires that a valid trust have two basic but essential components. The first is the grantor, or settlor, of the trust. This is the individual who establishes the trust and will generally hold the trust property during his or her lifetime. The other component is a beneficiary, who receives the trust property upon the grantor’s death. A valid Tennessee gun trust must have a grantor and a beneficiary. The two cannot be the same person.
Many trusts also have trustees. Trustees are individuals who oversee the trust property should the grantor die or become incapacitated. If the beneficiary is a minor, a trustee can serve as a manager of the trust property until the beneficiary is of appropriate age and maturity to own the trust property. In an NFA trust, trustees may possess the property just as the grantor can, and in fact that is one of the main benefits of an NFA trust.
Setting up a corporation is another way to own NFA items, but a trust is better. Corporations are public and must be filed with the secretary of state. Trusts, on the other hand, are private. Corporations require annual fees and taxes, but trusts do not. Trusts, on the whole, are simpler and less expensive than corporations.
Perhaps the biggest advantage of a Tennessee NFA gun trust is that it allows the grantor to prepare for the future by preselecting beneficiaries and trustees. (And because of the flexibility of trusts, these individuals can be changed if necessary.) Knowing that your NFA items will be going to individuals that you have specially selected and that you trust is reassuring. Also, a trust will streamline and shorten the registration process. For instance, individuals must get fingerprinted and photographed as part of their registration, as well as have approval from their local chief law enforcement officer. None of this is necessary, though, if you are preparing a trust.
Patrick Stegall is a Tennessee NFA gun trust lawyer . He helps individuals and families set up trusts for the ownership of NFA weapons such as suppressors and short barrelled rifles. Please visit him online at http://www.stegall-law.com.